As a safe haven, gold is one of the investments many turn to in times of uncertainty. With global uncertainty picking up, gold miners are often a top choice for many investors in this environment.
As a hedge against inflation, currency depreciation, and a range of other factors investors are worried about, gold miners are a great place to be. In my view, two of the best options for investors right now are Agnico Eagle (TSX:AEM)(NYSE:AEM) and Barrick Gold (TSX:ABX)(NYSE:GOLD).
Here’s why these two stocks are atop my watch list in terms of gold miners right now.
Agnico Eagle
Since 1998, Agnico Eagle has outperformed both gold equities and gold. This stock has provided investors with a compounded annual growth rate of around 13%. That’s impressive.
Agnico Eagle has accomplished this as a result of a well-executed strategy to create shareholder value. Of course, the rising price of gold has helped this company’s fundamentals in a big way. However, Agnico Eagle has a number of other factors that has worked in its benefit for some time.
Namely, Agnico Eagle’s growth has been driven by strong investment in its core operations as well as optimal acquisitions. In particular, I think the acquisition of Kirkland Lake Gold was one of the best consolidations in the industry. As investors look for miners with reserves backing their long-term growth prospects, Agnico Eagle could outperform.
Additionally, Agnico Eagle’s fundamentals are solid. This company is expected to post exceptional levels of free cash flow over the long term. And it’s a company with one of the lowest share counts among its peers. Indeed, for those bullish on the price of gold, there’s a lot to like about this top gold miner right now.
Barrick Gold
Similar to Agnico Eagle, Barrick Gold is driven by many of the same factors. As far as reserves go, Barrick is among the leading global players in gold reserves. From a production standpoint, this is also true.
Thus, for investors looking for size and scale in this industry, there’s a lot to like about how this company is positioned. Barrick’s mines are located in mining-friendly jurisdictions in South America, Australia, North America, and Africa. The gold miner has nine gold mines — among which the Carlin mine generates a significant portion of the company’s revenues.
From a geographical standpoint, the United States accounts for most of ABX’s revenue. Thus, investors who are spooked by the current geopolitical situation might find this to be a good thing.
Meanwhile, Barrick Gold continues to post impressive earnings. This company reported net earnings of $726 million during Q4. This is a substantial increase from last year’s figure. However, that does not factor in the same quarter’s impressive growth in gold prices.
I think for those bullish on gold, both Agnico and Barrick are excellent choices. These are top-notch companies with excellent growth outlooks.
